HB5097 104TH GENERAL ASSEMBLY

LRB104 17494 LNS 30920 b

104TH GENERAL ASSEMBLY
State of Illinois
2025 and 2026
HB5097

Introduced 2/10/2026, by Rep. Angelica Guerrero-Cuellar

SYNOPSIS AS INTRODUCED:

105 ILCS 5/27A-7.5
105 ILCS 5/27A-11

Amends the Charter Schools Law of the School Code. Allows the State Board of Education to withhold from each charter school it authorizes up to an additional 3% of the revenue provided to the school as an administrative fee for the purpose of conducting administrative duties related to the administration of the charter school contract, oversight, or authorizing services. Provides that for a charter school authorized by a school board, any amount of agreed funding withheld by the school board as an administrative fee for the purpose of conducting administrative duties related to the administration of the charter school contract, oversight, or authorizing services may not exceed 3% of agreed funding and the amount withheld may not result in the charter school receiving less than the required minimum funding level. Sets forth allowable uses for the administrative fee. Provides that any portion of the administrative fee that is not expended on allowable uses during the fiscal year shall be returned to the charter school. Requires the school board to provide an annual public accounting to the charter school and to the State Board detailing the amount collected as an administrative fee, the allowable uses funded from the fee, and the amount returned from any unexpended fee funds.

STATE MANDATES ACT MAY REQUIRE REIMBURSEMENT MAY APPLY

A BILL FOR

AN ACT concerning education.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 5. The School Code is amended by changing Sections 27A-7.5 and 27A-11 as follows:

(105 ILCS 5/27A-7.5)

Sec. 27A-7.5. State Board fees; State Charter School Commission; abolition and transfer to State Board; appeal hearing fee.

(a) (Blank).

(a-5) (Blank).

(b) (Blank).

(c) (Blank).

(d) (Blank).

(e) (Blank).

(f) (Blank).

(g) (Blank).

(g-5) (Blank).

(h) (Blank).

(i) (Blank).

(j) The State Board may charge a charter school that it authorizes a fee not to exceed 3% of the revenue provided to the school to be used exclusively for covering the cost of authorizing activities. Authorizing activities may include, but are not limited to: (i) soliciting, reviewing, and taking action on charter school proposals; (ii) hiring, training, and supervising staff engaged in authorizing activities; (iii) developing and conducting oversight, including regular monitoring, of authorized charter schools; (iv) reporting on best practices and performances of charter schools; (v) applying for, managing, and distributing grants and funds appropriated for charter schools and authorizing activities; (vi) training members of the State Board on their authorizing roles; and (vii) training other employees of the State Board on how to work with charter schools as their own local education agencies.

In addition, the State Board may withhold from each charter school it authorizes up to 3% of the revenue provided to the school as an administrative fee for the purpose of conducting administrative duties related to the administration of the charter school contract, oversight, or authorizing services.

(k) On July 1, 2020, the State Charter School Commission or "Commission" (established by Public Act 97-152 as an independent State agency with statewide chartering jurisdiction and authority) is abolished and the terms of all members end. On that date, all of the powers, duties, assets, liabilities, contracts, property, records, and pending business of the Commission are transferred to the State Board. For purposes of the Successor Agency Act and Section 9b of the State Finance Act, the State Board is declared to be the successor agency of the Commission. Beginning on July 1, 2020, references in statutes, rules, forms, and other documents to the Commission shall, in appropriate contexts, be deemed to refer to the State Board. Standards and procedures of the Commission in effect on July 1, 2020 shall be deemed standards and procedures of the State Board and shall remain in effect until amended or repealed by the State Board.

On July 1, 2020, any charter school authorized by the Commission prior to July 1, 2020 shall have its authorization transferred to the State Board, which shall then become the school's authorizer for all purposes under this Article. On July 1, 2020, all of the powers, duties, assets, liabilities, contracts, property, records, and pending business of the Commission as the school's authorizer must be transferred to the State Board. At the end of its charter term, a charter school may reapply to the board or boards for authorization.

On July 1, 2020, all rules of the State Board applicable to matters falling within the responsibility of the Commission shall be applicable to the actions of the State Board.

(l) In any appeal filed with the State Board under this Article, both the applicant and the authorizing school district of the charter school shall have the right to request a hearing before the State Board. If more than one entity requests a hearing, then the State Board may hold only one hearing, wherein the applicant and the school district shall have an equal opportunity to present their respective positions.

(Source: P.A. 103-175, eff. 6-30-23.)

(105 ILCS 5/27A-11)

Sec. 27A-11. Local financing.

(a) For purposes of the School Code, pupils enrolled in a charter school shall be included in the pupil enrollment of the school district within which the pupil resides. Each charter school (i) shall determine the school district in which each pupil who is enrolled in the charter school resides, (ii) shall report the aggregate number of pupils resident of a school district who are enrolled in the charter school to the school district in which those pupils reside, and (iii) shall maintain accurate records of daily attendance that shall be deemed sufficient to file claims under Section 18-8.15 notwithstanding any other requirements of that Section regarding hours of instruction and teacher licensure.

(b) Except for a charter school established by referendum under Section 27A-6.5, as part of a charter school contract, the charter school and the local school board shall agree on funding and any services to be provided by the school district to the charter school. Agreed funding that a charter school is to receive from the local school board for a school year shall be paid in equal quarterly installments with the payment of the installment for the first quarter being made not later than July 1, unless the charter establishes a different payment schedule. However, if a charter school dismisses a pupil from the charter school after receiving a quarterly payment, the charter school shall return to the school district, on a quarterly basis, the prorated portion of public funding provided for the education of that pupil for the time the student is not enrolled at the charter school. Likewise, if a pupil transfers to a charter school between quarterly payments, the school district shall provide, on a quarterly basis, a prorated portion of the public funding to the charter school to provide for the education of that pupil.

For a charter school authorized by a local school board, any amount of the agreed funding withheld by the local school board as an administrative fee for the purpose of conducting administrative duties related to the administration of the charter school contract, oversight, or authorizing services may not exceed 3% of the agreed funding, and the amount withheld may not result in the charter school receiving less than the minimum funding level required under this subsection (b). Allowable uses for the administrative fee are limited to direct authorizing functions, including, charter application review, contract negotiation, performance monitoring, compliance oversight, site visits, financial and governance review, renewal determinations, and required reporting to the State Board. The administrative fee may not be used for general district operations unrelated to charter authorizing. Any portion of the administrative fee that is not expended on allowable uses during the fiscal year shall be returned to the charter school. The local school board shall provide an annual public accounting to the charter school and to the State Board detailing the amount collected as an administrative fee, the allowable uses funded from the fee, and the amount returned from any unexpended fee funds.

All services centrally or otherwise provided by the school district including, but not limited to, rent, food services, custodial services, maintenance, curriculum, media services, libraries, transportation, and warehousing shall be subject to negotiation between a charter school and the local school board and paid for out of the revenues negotiated pursuant to this subsection (b); provided that the local school board shall not attempt, by negotiation or otherwise, to obligate a charter school to provide pupil transportation for pupils for whom a district is not required to provide transportation under the criteria set forth in subsection (a)(13) of Section 27A-7.

In no event shall the funding be less than 97% or more than 103% of the school district's per capita student tuition multiplied by the number of students residing in the district who are enrolled in the charter school.

It is the intent of the General Assembly that funding and service agreements under this subsection (b) shall be neither a financial incentive nor a financial disincentive to the establishment of a charter school.

The charter school may set and collect reasonable fees. Fees collected from students enrolled at a charter school shall be retained by the charter school.

(c) Notwithstanding subsection (b) of this Section, the proportionate share of State and federal resources generated by students with disabilities or staff serving them shall be directed to charter schools enrolling those students by their school districts or administrative units. The proportionate share of moneys generated under other federal or State categorical aid programs shall be directed to charter schools serving students eligible for that aid.

(d) The governing body of a charter school is authorized to accept gifts, donations, or grants of any kind made to the charter school and to expend or use gifts, donations, or grants in accordance with the conditions prescribed by the donor; however, a gift, donation, or grant may not be accepted by the governing body if it is subject to any condition contrary to applicable law or contrary to the terms of the contract between the charter school and the local school board. Charter schools shall be encouraged to solicit and utilize community volunteer speakers and other instructional resources when providing instruction on the Holocaust and other historical events.

(e) (Blank).

(f) (Blank).

(g) At the non-renewal or revocation of its charter, each charter school shall refund to the local board of education all unspent funds.

(h) A charter school is authorized to incur temporary, short term debt to pay operating expenses in anticipation of receipt of funds from the local school board.

(Source: P.A. 103-175, eff. 6-30-23.)